WEBVTT - Ricardo Hausmann Talks Venezuela

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<v Speaker 1>Bloomberg Audio Studios, podcasts, radio news.

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<v Speaker 2>Riccardo Housman is definitive on his Venezuela. Riccardo, I want

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<v Speaker 2>to go back before your acclaim at Harvard, before your

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<v Speaker 2>public service decades ago, to your Venezuela. How did the

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<v Speaker 2>Houseman family get from a World War two Europe over

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<v Speaker 2>to Venezuela. How did your family emigrate to Venezuela a

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<v Speaker 2>lifetime ago.

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<v Speaker 1>Well, a Jewish family, my father, they both went through

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<v Speaker 1>the Holocaust. My father lost both his parents. He arrived

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<v Speaker 1>at Venezuela at age seventeen with some He managed to

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<v Speaker 1>get himself to Spain, and then everybody in Spain thought

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<v Speaker 1>that Hitler was going to take over Spain, so he

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<v Speaker 1>ended up with another relative in Venezuela. And my mother

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<v Speaker 1>lived through the the German occupation in Belgium and she

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<v Speaker 1>was freed by the USGIS in September nineteen forty four.

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<v Speaker 1>She was living with a Catholic family in a village

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<v Speaker 1>in the south of Belgium until they were liberated. She

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<v Speaker 1>lived for over a year thereafter after, as you know,

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<v Speaker 1>they got the papers to go to the train station

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<v Speaker 1>in nineteen forty two, So that's That's how they ended

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<v Speaker 1>up in Venezuela. And in Venezuela they had a you know,

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<v Speaker 1>they created a really really nice life for themselves. And

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<v Speaker 1>so when I grew up, Venezuela was this heaven and

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<v Speaker 1>well I had this image of Europe as this horrible

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<v Speaker 1>place where my parents had covered from right, I.

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<v Speaker 2>Look Professor Housman and against this is part of the story,

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<v Speaker 2>folks from Venezuela's at the tip of oargin China. Your

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<v Speaker 2>economist essay written yesterday for Zeniment is absolutely scathing. You

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<v Speaker 2>say the President of the United States is quote delusional.

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<v Speaker 2>What does President Trump get wrong?

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<v Speaker 1>Well, he thinks that extracting oil from the ground is

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<v Speaker 1>a technical issue. But extracting oil from the ground, if

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<v Speaker 1>it was a technical issue and as well, would be

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<v Speaker 1>a powerhouse. But the reason why oil production in Venezuela collapsed,

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<v Speaker 1>that so many other things collapsed, is because oil is

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<v Speaker 1>a long term investment proposition. You have to part with

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<v Speaker 1>a lot of money and wait until you know you

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<v Speaker 1>get a cash flow to recover that money over a

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<v Speaker 1>very long period of time. And in that long period

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<v Speaker 1>of time, you have to be assured that you have

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<v Speaker 1>some property rights that are going to be respected. And

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<v Speaker 1>if he thinks that right now, he's going to recover

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<v Speaker 1>oil production because he's going to tell us major companies

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<v Speaker 1>to go out and part with billions of dollars in

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<v Speaker 1>Venezuela in the context of an illegitimate government because Madula

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<v Speaker 1>stole an election. But this woman who's now president of Venezuela,

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<v Speaker 1>she didn't even win a pretend to win an election.

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<v Speaker 1>She was appointed by a guy who stole an election.

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<v Speaker 1>And he's going to get concessions that have no approval

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<v Speaker 1>in law by any any national assembly that was elected

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<v Speaker 1>by anybody. And you would expect at the moment they

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<v Speaker 1>will go back to democracy, that any of those conditions

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<v Speaker 1>are going to be respected by a new by a

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<v Speaker 1>new political majority. So I think that there is the

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<v Speaker 1>Democracy is not a goal to be put after economic recovery.

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<v Speaker 1>Democracy is an instrument of economic recovery. It's the way

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<v Speaker 1>of telling Venezuelans your rights will be protected. Go back

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<v Speaker 1>and and and and you know, dream go.

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<v Speaker 2>Back to You knew as a kid RICARDA Houston with

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<v Speaker 2>us of Carver University. Folks were thrilled that he could

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<v Speaker 2>be with the Shannon O'Neil coming up We welcome all

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<v Speaker 2>of you around the world. Please subscribe YouTube Paul and

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<v Speaker 2>I humbled by the digital success this year. Paul Sweeney

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<v Speaker 2>with Ricardo Housman, Professor.

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<v Speaker 3>Do we know or what can you tell us about

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<v Speaker 3>what the average Venezuelan really on the ground once from

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<v Speaker 3>this government going forward or from any government?

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<v Speaker 1>Well, I mean Venezuelans voted massively in favor of a

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<v Speaker 1>change of direction. Right they when they were allowed to

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<v Speaker 1>have a primary that the government tried to prevent. Well,

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<v Speaker 1>Maria Corina Machalo won with ninety plus percent of the

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<v Speaker 1>vote when she was not allowed to run and she

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<v Speaker 1>anointed somebody to run instead. They voted. This guy won

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<v Speaker 1>with a margin of forty points, and he didn't want

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<v Speaker 1>buy more because they didn't not let us Venizuant's abroad

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<v Speaker 1>vote and they did not let three million young Venezuelans

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<v Speaker 1>to register. Had that happened, we would have won with

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<v Speaker 1>an even larger margin. So Venezuelans are unified politically in

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<v Speaker 1>a new direction. If you allowed Venezuelants to choose, they

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<v Speaker 1>would choose a very competitive legal framework for oil, and

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<v Speaker 1>they would engineer on oil boom. We don't need a

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<v Speaker 1>you know, American help to engineer an oil boom, because

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<v Speaker 1>the world is full of oil companies that would want

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<v Speaker 1>to create back into Venezuela under the right conditions, and

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<v Speaker 1>we have a political majority to create the right conditions.

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<v Speaker 1>But this system that they have described right now, it's

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<v Speaker 1>not workable. It's something that works on one on a

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<v Speaker 1>day to day basis. That they're saying, well, we leave

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<v Speaker 1>the same bad guys that were in power before, the

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<v Speaker 1>guys who are indicted. I mean the guys who are

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<v Speaker 1>in the same indictment as Nicolas Maluru is the Minister

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<v Speaker 1>of Defense and the other one is the Minister of

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<v Speaker 1>the Internal Police. So it's the same guys. We're there

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<v Speaker 1>and they pretend to say, well, we are going to

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<v Speaker 1>tell them what to do and they're going to do

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<v Speaker 1>our bidding. But when they say our bidding, they think

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<v Speaker 1>that they can get a recovery of Venezuela without empowering

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<v Speaker 1>Venezuelan citizens with rights. That's not going to work.

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<v Speaker 3>Professor Issert, do you think if there's a scenario where

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<v Speaker 3>the Trump administration can in fact exert control over this

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<v Speaker 3>government like I think they think they can.

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<v Speaker 1>Well, I mean what they think they can is to

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<v Speaker 1>say either you do what I tell you, or I

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<v Speaker 1>kill you because I have drones. I don't want to

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<v Speaker 1>put boots on the ground. I have drones, I have missiles.

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<v Speaker 1>I can kill you. So you better do what we want.

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<v Speaker 2>But when they interrupt Ricardo, but Paul nailed it with

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<v Speaker 2>that question. What this is about is in is direct

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<v Speaker 2>community violence, whether it's Cuba or Venezuela. I mean President

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<v Speaker 2>Trump in his advocates have to decide if they want

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<v Speaker 2>to participate with people who are violent. How do you

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<v Speaker 2>want in your Venezuela? How do we move forward to

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<v Speaker 2>a constructive end? What's the Houseman process? In January, February,

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<v Speaker 2>in March of this year.

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<v Speaker 1>Well, you want to empower the people who have strategic

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<v Speaker 1>interests that are aligned with you, and that is all

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<v Speaker 1>the Venezuela Democrats. So this idea that you can do

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<v Speaker 1>your thing without having to deal with the organized Venezuelan

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<v Speaker 1>opposition that, under enormously difficult situations, was able to win

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<v Speaker 1>an election. You want, you want to you want to

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<v Speaker 1>empower them to help you. Do you want the strategic

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<v Speaker 1>aligance with them? But you don't want to hear this

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<v Speaker 1>dismissive description of my Akorina Machau as somebody who's not

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<v Speaker 1>respected in Venezuela. I challenge you to mention somebody in

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<v Speaker 1>the world who's more respected than Manrie Akorina Machau. Obviously,

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<v Speaker 1>she's super respected in Venezuela. That's why she can win

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<v Speaker 1>elections in Venezuela. Now that's different from saying she has

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<v Speaker 1>the command over troops.

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<v Speaker 2>We're gonna have share O'Neill with this, Professor Hausman. But

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<v Speaker 2>let me ask you this Viscal. This came up, Paul

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<v Speaker 2>outside of the dining room table. Where does the military

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<v Speaker 2>of Venezuela fit in? I mean, if I look at

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<v Speaker 2>the Philippines and the shift from du Terte to the

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<v Speaker 2>younger Marcos, the military played a part there. Instability is

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<v Speaker 2>the military of your Venezuela stable or unstable?

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<v Speaker 1>The military of Venezuela is led by a narco terrorist

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<v Speaker 1>organization and they're still in power. But below that, there's

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<v Speaker 1>a lot of people who would be willing, who would

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<v Speaker 1>want to go back to a more democratic regime under

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<v Speaker 1>civilian rule, but they cannot. They are not allowed to organize,

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<v Speaker 1>they're being spied by the military secret police, and they're

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<v Speaker 1>being put in prison. They're being tortured. So what we need,

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<v Speaker 1>if if Trump is going to demand something from from

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<v Speaker 1>Delci Rodriguez, is that she she delivered Geosdalo Cabago, the

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<v Speaker 1>head of the police, Vladimir Padrino, the Minister of Defense.

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<v Speaker 1>Those are the heads of the Cartel of the Sons,

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<v Speaker 1>the Cartel de los Soles. They are the narco traffickers.

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<v Speaker 1>They are now in charge of the country and they

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<v Speaker 1>are the ones who yesterday put in prison twelve journalists,

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<v Speaker 1>so that the number of political prisoners in Venezuela is

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<v Speaker 1>going up, not down. Okay, So you want you want

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<v Speaker 1>to fix the country, you need to get rid of

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<v Speaker 1>these leaders, this corrupt, criminal leadership that is in control

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<v Speaker 1>of army and to empower the public of the army

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<v Speaker 1>to go back to civilian rules.

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<v Speaker 2>Paul get one more question from professor.

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<v Speaker 3>Professor, is a scenario where the people of Venezuela rise

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<v Speaker 3>up and force change.

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<v Speaker 1>I think that you know, everybody now is willing to

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<v Speaker 1>give a line of credit because you know, we've tried

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<v Speaker 1>so hard to get rid of Maluro and we weren't

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<v Speaker 1>able to do it on our own. So everybody is

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<v Speaker 1>very happy that that the US was able to get

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<v Speaker 1>rid of Maluro. But and and they're hoping that this

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<v Speaker 1>is the beginning of a good process. But you know,

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<v Speaker 1>the statements of Trump after you know, at Madlago and

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<v Speaker 1>afterwards were extremely disempowering and concerning. They described a vision

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<v Speaker 1>for the future that I do not think it's going

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<v Speaker 1>to work, and I don't think that Venezuelans are going

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<v Speaker 1>to feel that that is there is the right prime.

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<v Speaker 2>Professor Hausman, thank you so much for leading our coverage

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<v Speaker 2>this morning. Ricarda houseman with the Kennedy School, Harvard, and

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<v Speaker 2>of course looked to his piercing essay and the economist